Upslope Capital Management, an investment management firm, released its first-quarter 2025 investor letter. A copy of the letter can be downloaded here. The First quarter was challenging for the fund. However, the world has transformed in the two weeks since March 31, due to a drastic realignment of international trade rules. As a result, markets are now more in line with Upslope's strategy and portfolio. The fund returned -5.1% (net) in Q1 compared to -6.1% and +0.2% for the S&P Midcap 400 ETF (MDY) and HFRX Equity Hedge Index, respectively. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its first-quarter 2025 investor letter, Upslope Capital Management highlighted stocks such as MarketAxess Holdings Inc. (NASDAQ:MKTX). MarketAxess Holdings Inc. (NASDAQ:MKTX) is an electronic trading platform for institutional investors and broker-dealer companies. The one-month return of MarketAxess Holdings Inc. (NASDAQ:MKTX) was 4.10%, and its shares gained 8.50% of their value over the last 52 weeks. On April 21, 2025, MarketAxess Holdings Inc. (NASDAQ:MKTX) stock closed at $222.17 per share with a market capitalization of $8.487 billion.

Upslope Capital Management stated the following regarding MarketAxess Holdings Inc. (NASDAQ:MKTX) in its Q1 2025 investor letter:

"MarketAxess Holdings Inc. (NASDAQ:MKTX): Challenged member of fixed income/credit “exchange” duopoly. Given macro/geopolitical backdrop and depressed valuation, company appears likely to stabilize market share (or better) in the near-term and/or be acquired by a large exchange in the medium-term.

In Q1, the Fund also added MarketAxess (MKTX, a leading credit and fixed income exchange), a business Upslope has owned (and at times shorted) several times over the years. MKTX has had a challenging five years or so, but (1) should see stabilized/improved market share with higher volatility, (2) trades at a deep enough discount to consider the possibility of a take-out in the near-to-medium term."

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MarketAxess Holdings Inc. (NASDAQ:MKTX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 45 hedge fund portfolios held MarketAxess Holdings Inc. (NASDAQ:MKTX) at the end of the fourth quarter which was 42 in the previous quarter. While we acknowledge the potential of MarketAxess Holdings Inc. (NASDAQ:MKTX) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

In another article, we covered MarketAxess Holdings Inc. (NASDAQ:MKTX) and shared the list of best debt free mid cap stocks to buy. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.